US Housing Inventory at a Post-crisis Low — PragCap

US Housing Inventory at a Post-crisis Low

Here’s an important statistic that’s been getting a lot of attention lately in housing circles – the decline in inventory.   I’ve been pretty vocal about the fact that I do not think there’s much downside in housing from here, but that I believe it would be extremely abnormal for a post-bubble turnaround to occur.  Generally, these post-bubble eras end up working off excesses for a very long time.  And I think this is a pertinent detail.  As you’ll see below, inventory has come way down.  But let’s not lose perspective.  We’re only back to the 2006 levels when, by pre-crisis standards, this level would have been considered well above normal.  I expect more working off to be done….Our friends at Sober Look have the details:

As discussed earlier the US housing recovery is progressing, albeit quite gradually, as the unsold inventory of homes continues to decline.

Barclays Capital: – We continue to see conditions in the existing home market as putting downward pressure on inventories and as supportive of a gradual cleansing of shadow inventory. Our view is that housing is in a recovery phase, but one that will be restrained by the availability of credit, pace of improvement in labor market conditions, and overhang from distressed and foreclosed properties.

Source: Barclays Capital

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